Insurance alert for couchsurfers
Travel Insurer Southern Cross is warning that claims resulting from incidents that happen while "couchsurfing" won't be covered by its policies.
Couchsurfing is an international movement in which travellers seek to avoid accommodation bills by joining networks of like-minded folk who believe in the concept of strangers staying in each others' places, often sleeping on the couch.
If offers the opportunity to slash the costs of seeing the world - there are couches available in more than 100,000 cities - and it has attracted a following here.
Southern Cross says there are around 25,000 members of the largest couchsurfing website couchsurf.com in Auckland, Wellington and Christchurch, and there are more than 20 "chapters" around New Zealand.
But the insurer says travel policies contain an exclusion which means any claims resulting from bad things happening while couchsurfing won't be covered.
Most Kiwis wouldn't accept a lift from a stranger but many are happily arranging to sleep on the sofa of someone they've never met on the other side of the world, said Southern Cross Travel Insurance chief executive Craig Morrison.
"People really need to exercise a healthy amount of caution," he said. "In the travel insurance business we insure against unexpected events and, unfortunately, having your property stolen when sleeping in a stranger's house wouldn't reasonably qualify as unexpected. Even if the traveller is given a key and is able to lock their belongings away in a secure place, there's no guarantee the owner or their family and friends wouldn't have other keys."
Insurers also warn about the risks of inviting couchsurfers into your place, saying most house and contents policies won't cover for damage or thefts by guests.
Insurer IAG, which owns the State, NZI and AMI brands, said: "Most policies exclude intentional acts/damage (this varies by wording) or theft (theft may or may not be listed, however is considered an intentional act) by those living at the home and guests. The exception to this is fire or explosion caused by guests or residents, even if intentional, other than the insured and their partner."
And, insurers say, if you are going to let couchsurfers into your home regularly, you need to tell them about that.
IAG said: "It would be unusual for us to apply terms where the insured remains resident, but if we were not told of these circumstances and would have applied terms, non-disclosure could cause problems in the event of a loss and subsequent claim."
Airbnb is an online service that matches travellers with people renting out either their whole place, or a room. Like couchsurfing, participating in it needs to be revealed to your insurer. If a homeowner does it frequently, their insurer may require them to buy a commercial insurance policy.
"Due to the often sporadic nature of these arrangements and that the insured will still be occupying the home, there is no set number of times that would trigger commercial cover being needed for the home,"IAG said.
But if money is being made, then some parts of policies will not operate, such as liability for the insured. "A real-life example of this would be that the insured leaves a pot on the stove and nods off to sleep in their chair. The pot boils over and causes a fire that, as well as damaging the home and contents that belong to the insured, also destroys the items the guest had at the home. We cover the insured's damage and the guest would claim under their policy with their insurer holding our insured liable due to negligence. The policy would not respond as it is liability in connection to a paying guest."
Insurers will also expect to see policyholders take reasonable precautions when being involved in Airbnb or allowing couchsurfers in. This can include making sure they have a robust process for vetting the potential tenants, which would include obtaining written or verbal references, signing a tenancy agreement and possibly collecting a bond.
It's not just couchsurfers who Southern Cross is warning.
It has seen an increase in the number of claims from people who have been ripped-off in online accommodation scams.
One customer booked an apartment in New York through online classifieds site www.craigslist.com only to discover there was no apartment and the person they'd paid the deposit to had vanished.
It has also had claims from people who booked accommodation through Airbnb.com.
"In these cases a fake account has been created by a scammer and professional-looking rental agreements have been sent to the insured, who have then paid a deposit through Western Union to secure their booking. Of course they never hear from the ‘owner' of the rental again and their money is gone," said Morrison.
Sunday Star Times